Nanomaterials possess unique physicochemical and biological properties but can also exhibit different adverse reactions if inhaled. Our previous in vivo study showed upon alveolar deposition, dispersed single-walled carbon nanotubes (DSWCNT) rapidly enter interstitial area (1 day post-exposure) and induce interstitial fibrotic response as early as 1 week post-exposure. Direct stimulation of cultured lung fibroblasts, a major interstitial cell, by DSWCNT was shown to enhance proliferation and collagen production, a hallmark of lung fibrosis. Furthermore, penetration of DSWCNT through lung epithelial barrier into interstitium could be a key event of DSWCNT-induced interstitial fibrosis. To investigate this alveolar epithelial barrier, an experimental model was developed using immortalized human lung epithelial cell line (ATCC, Manassas, VA). Epithelial cells were cultured on the apical surface of Transwell microporous membrane and exposed to non-dispersed SWCNT and DSWCNT. Samples from the apical compartment, cell monolayer, and basolateral compartment were collected at various times and analyzed for CNT penetrability. Electron microscopy and CytoViva hyperspectral imaging were used to aid characterization of the penetration pathway (paracellular vs. transcellular) of nanoparticles across alveolar epithelial membrane. The effect of CNT dispersion status on penetration rate was also assessed. Our data suggest CNT penetrated through epithelial cells on apical side and translocated to the other side of the Transwell membrane and the amount of CNT transferred, measured by hyperspectral imaging, was sufficient to induce fibroblast proliferation and collagen production based on previous data. The Transwell system is a suitable model for studying translocation of CNT across epithelial layer and aids in mechanistic studies of CNT- induced interstitial lung fibrosis.